2LT National News

MELBOURNE, Australia: Australian Prime Minister Anthony Albanese has urged China to allow the smooth flow of Australian iron ore exports, after reports emerged that Beijing had instructed buyers to halt purchases from mining giant BHP.

On October 1, Bloomberg reported that China Mineral Resources Group Co. (CMRG), a state-run enterprise created to strengthen China’s leverage in the global iron ore trade, told steelmakers and traders to temporarily stop buying U.S. dollar-denominated seaborne shipments from BHP. The directive, reportedly tied to contract negotiations, also covers cargo that has already departed from Australia.

Speaking to reporters, Albanese said he was “concerned” by the disruption to Australia’s most valuable export commodity. “I want to see Australian iron ore be able to be exported into China without hindrance. That is important. It makes a major contribution to China’s economy, but also to Australia’s,” he said.

Albanese added that such measures were “always disappointing,” but expressed hope the dispute would be short-lived. “Sometimes when people are negotiating over price, these things occur. But I want to see this resolved quickly,” he noted.

Treasurer Jim Chalmers echoed the concern, saying he would seek a meeting with BHP chief executive Mike Henry to discuss the development. “I’ve seen those reports; they’re concerning. Ultimately, though, they are about the commercial arrangements between two companies and, in one respect, a matter for the company to work through,” Chalmers said. Still, he stressed the government would continue to defend Australia’s trade interests “calmly and carefully, advocating for the workers, businesses, and investors of our country.”

BHP, the world’s largest miner headquartered in Melbourne, declined to comment on the negotiations, while CMRG did not respond to media requests.

The incident highlights the delicate nature of trade ties between the two countries. China is Australia’s biggest export market, and iron ore has long underpinned the relationship despite periodic tensions. Canberra has faced billions in losses from Chinese tariffs and restrictions imposed during years of political friction. However, many of those barriers have been lifted since Albanese’s Labor government came to power in 2022.

Unlike wine, barley, coal, and other commodities targeted in earlier trade disputes, iron ore was shielded mainly from punitive measures because of its central role in China’s steelmaking industry. The sector relies heavily on Australian supply, and analysts note that Beijing’s move may be more about bargaining power than long-term disruption.

Even so, any sustained halt in BHP purchases could rattle markets, given the company’s dominance in the global seaborne trade and the importance of iron ore revenues to Australia’s economy.